IAC/InterActiveCorp (NASDAQ:IAC) subsidiary Urbanspoon has a huge userbase on the web and on the iPhone. As a matter of fact, about one million people “shake” the iPhone application per day.
Now Urbanspoon is setting up a reservation system with a pilot of 4 restaurants in Seattle. The reservation system competes directly with OpenTable, a service that has a reservation system that filed for an IPO this past Janaury. Eventually Urbanspoon will be opening up to additional restaurants.
OpenTable pays $300 per month to rent a terminal for reservations. Urbanspoon and OpenTable pay about $1 for every reservation made through the systems.
Amit Chowdhry | May 13, 2009 | 728 views | Comments Categorized under OpenTable
OpenTable Inc. is an online reservation system that can be used for over 10,000 restaurants in the U.S. The company is planning to have an IPO on May 20. The IPO will be underwritten by Merrill Lync & Co. The company plans to sell 3 million shares at a price of between $12 and $14. This should give them a net infusion of about $16.1 million.
Forty eight percent of the shares are going to be sold to existing shareholders. In 2007, OpenTable made about $41.1 million revenues. Last year the company made $55.8 million. The company will be trading on The Nasdaq Global Market with the symbol “OPEN.”
OpenTable is an online reservation system for restaurants that started eleven years ago. Thus far about 90 million table reservations have been made on OpenTable. They have filed an S-1 with the SEC indicating that they are ready to go IPO. OpenTable is hoping to raise $40 million from the IPO and wants their stock to be listed under the NASDAQ. Merrill Lynch is bookrunning the deal.
The company has made $41.3 million in revenues based on the first 9 months of 2008. This is a 41% increase from the year before. Revenue is generated by restaurants that pay subscription fees (54%) and reservation fees (42%) that show up through the system. Installation fees generate 4% of OpenTable’s revenues.
Through the IPO, OpenTable is hoping to raise an additional $40 million. Between 1999 and 2000, OpenTable raised about $48 million in VC funding. Fortunately former eBay executive Jeff Jordan was able to street the company through the bubble and make it as far as IPO. When a web 1.0 company makes it this far, you just have to commend it.
